French tech consultancy Cap Gemini Ernst & Young saw profits slide 40% last year, and has forecast that growth and profitability would not improve before mid-2002.

Cap Gemini, hit last year by the slide in technology spending, posted operating profit of 423m euros (�258m; $370m), slightly above analyst expectations, down from 703m euros in 2000.

Cap Gemini shares slipped 1.7% by 0815 GMT.

Cap Gemini announced several redundancy plans last year, cutting its workforce by 9%, or 5,400 staff.

But the reduction in costs has not kept pace with the slump in demand for technology-related and financial services, which were already weak ahead of the World Trade centre attacks.

"The group's objective is to recover growth and make significant improvement in operating margin as quickly as possible," Cap Gemini said in a statement.

"In both cases, the real turnaround cannot be expected before the middle of the year."